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12 Cards in this Set

  • Front
  • Back
What is a market?
A place or situation where an economic exchange takes place.
What is economic exchange?
An exchange of goods or services for money.
What are the major categories of markets?
-Product
-Factor
-Supply and Demand
Define demand.
The ability and willingness to buy specific quantities of a good at alternative prices in a given time period, ceteris paribus
Explain the assumption ceterus paribus.
In economics it is assuming certain market variables to determine the market forecast.
What is the relationship between price and quantity demanded?
The quantity of a good demanded in a given time period increases as its price falls.
Illustrate Demand schedule using a graph.
What are the determinants of demand? Explain how each factor affects demand.
Determinants of market demand include:
-Consumer tastes
-Consumer income
-Availability and prices of other goods
-Consumer expectations
-Number of buyers in the market
Explain the differences between changes in demand and changes in quantity demanded.
Changes in quantity demanded: Movements along a demand curve in response to changes in price for the good

Changes in demand: Shifts of the demand curve due to changes in the determinants of demand, which change the relationship between price and quantity demanded
Illustrate Changes in Quantity-Demanded
Illustrate Shift in Demand
How do economists define market demand?
Total quantities of a good or service people are willing and able to buy at alternative prices in a given time period.